NATIXIS_REGISTRATION_DOCUMENT_2017

FINANCIAL DATA Consolidated financial statements and notes

Determiningwhether there is objective evidence of impairment is based on a multi-criteria approach and independent expert opinions,particularlyin the case of debt instruments.Evidenceof impairmentincludes: for debt instruments:default on interest or principalpayments, a existence of mediation, warning or legal reorganization procedures; counterparty bankruptcy and any other indicator pointing to a material decline in the counterparty’s financial position,such as losseson completionprojectedby discounted cash flowmodels; for equity instruments (excluding investments in unlisted a companies): any item suggesting that the entity will not be able to recover all or part of its initial investment. Securities presentingan unrealizedcapital loss of over 30% on their face value, or presenting an unrealized capital loss for a period of more than six months, are systematically tested for impairment.The test involvesa qualitativeanalysisconsidering a variety of factors such as share price performance over a given period or information relating to the issuer’s financial position. Where necessary, an impairment loss is recognized based on the market price at the reportingdate. Irrespectiveof this analysis, an impairment loss is systematicallyrecognized when securitiespresent an unrealizedcapital loss of over 50% at the reportingdate, or an unrealizedcapital loss on their face value for a periodof more than 24 months; for investments in unlisted, non-consolidated companies: a unrealizedcapital losses of over 20% on their face value for a period of more than 18 months, or significant changes in the technological, market, economic or legal environment having an unfavorable impact on the issuer, suggesting that the amount invested in the equity instrument may not be recoverable; shares in private equity investment funds (FCPRs), net asset a value alone is not enough to determine whether there is any evidence that the initial investment might not be recovered. This is becausenet asset value during the investmentphase is reduced by start-up costs (structuring and brokerage fees, etc.).Accordingly,for investmentsof this type which are not quoted on an active market, the following impairment principlesapply: impairment is recognized if, at the reporting date, the j position and results of the fund are in line with the business plan, if this is not the case, the business plan must be revised in j order to determine whether the securities should be impaired. If the fair value of an available-for-salefinancial asset increases during a subsequentperiod, and this increase can be objectively linked to an event occurring after the impairment loss was chargedto income: reversals of impairment losses on equity instruments are a recordedin equity rather than in the incomestatement; reversals of impairment losses on debt instruments are a recorded in the amount of the previouslyrecorded impairment loss. In accordancewith IFRIC 10,impairmentlosses recordedagainst equity instruments at interim reporting dates are frozen in incomeand cannotbe reverseduntil the securitiesare sold.

Recognition date for securities transactions Securities bought or sold are, respectively, recognized or derecognized on the settlement date, regardless of their accountingcategory. Reversetransactionsare also recognizedon the settlementdate. For repurchaseand reverse repurchasetransactions,a financing commitment received or given respectively is recognized between the transaction date and the settlement date when these transactionsare recognizedin “Liabilities”and “Loans and receivables” respectively. When repurchase and reverse repurchasetransactionsare recognized in “Assets and liabilities at fair value through profit or loss”, the repurchasecommitment is recognizedas a forwardinterestrate derivative. Leases are classifiedas finance leases when substantiallyall the risks and rewards incidental to ownershipare transferredto the lessee.All other leasesare classifiedas operatingleases. IAS 17, which sets forth the accounting treatment of leases, gives five examplesof situationswhere substantiallyall the risks and rewards incidental to ownership are transferred to the lessee: the lease transfersownershipof the asset to the lessee by the a end of the lease term; the lessee has the option to purchasethe asset at a price that a is expected to be sufficiently below the fair value at the date the option becomesexercisablefor it to be reasonablycertain, at the inceptionof the lease, that the optionwill be exercised; the lease term is for the major part of the economiclife of the a asset; at the inceptionof the lease, the presentvalue of the minimum a lease payments amounts to at least substantially all the fair value of the leasedasset; the leased assets are of such a specializednature that only the a lesseecan use themwithoutmajormodifications. IAS 17 also describes three indicators that individually or in combination could also lead to a lease being classified as a financelease: if the lessee can cancel the lease, the lessor’s losses a associatedwith the cancellationare borneby the lessee; gains or losses from the change in the fair value of the residual a value accrueto the lessee; the lessee has the ability to continuethe lease at a rent that is a substantiallybelowthe marketrent. At inception,assets held under a finance lease are recognizedin the lessor’s balance sheet and presented as a receivable at an amount equal to the net investmentin the lease, corresponding to the present value of minimum lease payments due from the lessee discountedat the rate of return implicit in the lease, plus any non-guaranteedresidualvalue accruingto the lessor. Leases 5.2 Transactions where Natixis is a lessor

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Natixis Registration Document 2017